FONDATION MERIEUX USA, INC.Non-Profit

Condition: FMx-USA does not consistently maintain an appropriate level of documentation with respect to monitoring activities of the sub-recipients. Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): As stated in 2 CFR 200.331 part (b), all pass-through entities must evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring procedures to prescribe to each individual subrecipient. In accordance with part (d): pass-through entities must monitor the activities of the sub-recipient as necessary to ensure that the sub-award is used for authorized purposes, in compliance with Federal statutes, regulations and the terms and conditions of the sub-award; and that sub-award performance goals are achieved. Pass-through entity monitoring of the sub-recipient must include: 1. Reviewing financial and programmatic reports required by the pass-through entity. 2. Following-up and ensuring that the sub-recipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the sub-recipient from the pass-through entity detected through audits, on-site reviews, and other means. 3. Issuing a management decision for audit findings pertaining to the Federal award provided to the sub-recipient from the pass-through entity as required by ? 200.521 Management decision. Cause: FMx-USA is not following internal policies and procedures over sub-recipients. Effect or Potential Effect: FMx-USA could inadvertently engage in relationships with sub-recipients of higher risk without the appropriate level of oversight (monitoring) to ensure sub-recipients are expending funds in accordance with the provisions and terms of the subaward. Questioned Costs: None identified. Context: FMx-USA failed to adequately perform risk assessment procedures, or document its risk assessment procedures, over its sub-recipient. Our audit procedures consisted of substantive testwork over 100% of sub-recipient expenditures. We consider our sample to be representative of the population. Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that management be diligent in performing all pre-award risk assessments and monitoring activities with any sub-recipients.

Condition: FMx-USA did not register its subaward to the Federation in the Federal funding Accountability and Transparency Act Subaward Reporting System. Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): As noted in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements who make first tier subawards of $30,000 or more are required to register in the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) and report subaward data through FSRS. Cause: FMx-USA did not interpret the latest compliance supplement issued by the Office of Management and Budget regarding subaward reporting requirements to apply to the Federation, or update its financial and accounting policies, and as a result did not adhere to the guidance. compliance with Federal award agency regulations. Questioned Costs: None identified. Context: FMx-USA did not register their subawards in excess of $30,000 with the Federal Funding Accountability and Transparency Act Subaward Reporting System. Identification as a Repeat Finding, if Applicable: Not a repeat finding. Recommendation: We recommend that FMx-USA update its policies and procedures to ensure all first tier subawards in excess of $30,000 are accurately and timely registered with the Federal Funding Accountability and Transparency Act Subaward Reporting System, which would include the subawards to the Federation. In addition, FMx-USA should ensure any subawards are reported within the required time-frame. The list of data elements that are required to be reporting for each subaward in excess of $30,000 include the following: ??Subaward Date ??Subawardee DUNS # ??Amount of Subaward ??Subaward Obligation/Action Date ??Date of Report Submission ??Subaward Number